How to guarantee that every dollar of development counts

How to guarantee that every dollar of development counts

In 2017, 146 billion dollars were spent on aid and development. Even this large sum remains a fraction of what would be needed to achieve the United Nations Sustainable Development Goals (SDGs). Yet despite the scarce resources, there is a surprisingly small discussion on setting priorities for development spending.
In international surveys and on the world stage, developing countries are very clear about their priorities: improvement of health and education, better jobs and more, less corruption and solutions to challenges nutritional. Unfortunately, these areas are not necessarily where rich countries raise funds.
Indeed, if current trends hold true, the world will fail to achieve the OSS targets for 2030 in a number of areas: maternal mortality, tuberculosis, access to family planning, HIV, non-communicable disease mortality, access to primary school and primary, stunting, decay, malnutrition, violence against women, birth registration, access to water, gender equality in public leadership, access to sanitation and air pollution.
But instead of allocating development funding to try to accelerate progress in these areas, much of it is directed elsewhere. To cite the most striking example: the Organization for Economic Co-operation and Development estimates that more than 20 percent of development aid is spent on climate change projects and activities.
Clearly, more could be achieved in health care, education and other areas if a fifth of development spending does not go towards projects such as the development of inefficient solar "microgrids", which pop up a "climate" box for donors but they do little to transform lives. Climate concerns are at the last or last position among political issues in the global surveys of developing countries.
How could development funds be better used? Cost-benefit analysis can play a vital role in shedding light on interventions and investments that get the most out of every dollar spent.
The Copenhagen Consensus Center, the think tank I led, undertook a comprehensive study of the 169 SDG objectives. It looked at the whole menu of development options and added prices and detailed information on what each could get. This analysis revealed that out of 169 targets, 19 represent the best value for money.

Climate concerns are at the last or last position among political issues in the global surveys of developing countries.

Bjorn Lomborg

He considers the often neglected and politically frowned development goal of universal access to family planning, which the analysis showed would cost $ 3.6 billion a year. Ensuring that women have control over pregnancy would mean 150,000 fewer maternal deaths and 600,000 orphans less in the year. It would also lead to a demographic dividend, stimulating economic growth. The total benefits for the company of every dollar spent reach about $ 120.
Likewise, investment in child nutrition pays dividends for life because a healthy diet allows better brain and muscle development. Well-fed children stay longer at school, learn more and end up being more productive members of society. The evidence suggests that providing better nutrition for 68 million children each year would produce more than $ 40 in long-term social benefits for every dollar spent.
Or consider tuberculosis, the most deadly (and most neglected) infectious disease on the planet. Tuberculosis affects the poorest people in the world and mainly affects young adults at an age when they have just become parents and economically active. Families lose income and children lose their parents. Our analysis shows that the investment in the expansion of tuberculosis testing and treatment offers $ 43 of social benefits for every dollar spent.
An expert group of economists, including two Nobel Prizes, found that every dollar spent on these and the rest of the 19 most effective global development goals would return $ 20- $ 40 in long-term social benefits. On the contrary, the allocation of funds in a uniform way on all 169 targets would produce benefits lower than $ 10 per dollar spent. In other words, focusing first on taking the most effective actions is to double or even quadruple the aid budget.
The cost-benefit analysis of the Copenhagen Consensus Center is now helping to establish national priorities in Bangladesh and Haiti and at the state level in Rajasthan and Andhra Pradesh in India. In Bangladesh, the results supported the government's introduction of more efficient and transparent e-procurement policies and more focused nutrition initiatives; in Haiti, they are the basis of the decision of the government and donors to fortify local flour with vital micronutrients to save young lives.
The challenge is to further expand this approach. The cost-benefit analysis should not dictate how all aid and the dollar of development are spent. But the clock continues to take off at around 2030 and the world is lagging behind the times of many of its development goals. If we ignore economic efficiency, we risk failing to make the necessary progress against the greatest challenges of humanity.

• Bjorn Lomborg, visiting professor at the Copenhagen Business School, is director of the Copenhagen Consensus Center. His books include "The Skeptical Environmentalist", "Cool It", "How to spend $ 75 billion to make the world a better place", "The Nobel Leader for the brightest achievements for the world" and, more recently, " Give priority to development. "

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